Top telecom operators and the industry body have urged India’s telecom minister Ravi Shankar Prasad to sell 5G spectrum at reasonable price during the upcoming spectrum auction this year.
India will start 5G trials in the next 100 days. The announcement came at a time when Indian telecom operators are cagey about spectrum price. Last week, Airtel India CEO Gopal Vittal said mobile operators will not be able to buy 5G spectrum at huge prices.
The base price recommended by Indian telecom regulator TRAI places the 5G spectrum in a range of Rs 50,000-55,000 crore for 100 MHz of spectrum, Gopal Vittal said during the analyst call to discuss the fourth quarter financial performance of Airtel.
The ongoing 5G spectrum auction in Germany, into its 10th week, has drawn $6.7 billion in bids so far.
Ravi Shankar Prasad — who took office as the minister on Monday — said that he would prioritise the revival of crisis-ridden BSNL and MTNL. Ravi Shankar Prasad did not hint at any privatisation of the two state-owned telecom operators.
“We have a system of a standing committee and finance committee, and they are examining it the recommendations. Once they come up with solutions, we have to go to the Cabinet and appoint an auctioneer,” he added.
TRAI has recommended the auction of about 8,644 MHz of radiowaves — including those for 5G services — at an estimated total base price of Rs 4.9 lakh crore.
Telecom industry association Cellular Operators’ Association of India (COAI) said that the recommended base price of 5G spectrum is nearly 30-40 percent higher than the rates in markets like South Korea and the US.
“Majority of our operators have indicated that 5G spectrum is far too prohibitively expensive and that their balance sheets can’t afford this,” COAI director general Rajan Mathews told reporters on the sidelines of 5G spectrum policy workshop organised by the industry body Tuesday.
“Majority of our operators believe that the spectrum for 5G is overpriced by at least 30-40 per cent compared to international standards and auction in other markets like South Korea and the US,” Rajan Mathews said.
Balesh Sharma, the newly elected chairman of COAI and chief executive officer of Vodafone Idea, has also appealed to the government to ensure that 5G spectrum is made available to all players at reasonable prices and had pitched for lower levies and taxes to make the sector strong and sustainable.
Huawei hits roadblock
India on Monday expressed security concerns around the supply of Huawei’s telecom network to Indian mobile service providers.
Ravi Shankar Prasad said the government will take a view on whether Huawei will be allowed to participate in 5G trials. “There are security issues…it is not only a matter of technology, where their participation in 5G is concerned,” he said.
If India decides to block Huawei from supplying 5G network equipment, it will be a big blow on the China-based telecom equipment maker. Samsung, Ericsson, Nokia and ZTE are trying to cash in on the current issues.
The United States has blacklisted Huawei and it cannot source technology / components from American companies without the formal approval of the federal government — impacting the entire business of Huawei.
“Participation of 5G is not conditional upon the trial being started. Whether a particular company is allowed to participate or not is a complex question including security issues,” he added.
Last month, India government had constituted a committee, headed by the Principal Scientific Advisor, to decide on the fate of Huawei’s participation in the 5G trial.
China has passed a National Intelligence Law in October 2017 which mandates that they can ask any of their companies to provide any kind of data — either onshore or offshore.
India government will be in a challenging situation if Huawei supplies a network and collects some data and share the data with the Chinese government.